INCOME-TAX OFFICER, WARD - 3(5), PUNE vs. M/S. SATISH BORA AND ASSOCIATES, PUNE

The only issue projected through various grounds is against the granting of deduction u/s.80IB(10) of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) on proportionate basis.

Succinctly, the factual matrix of the case is that the assessee filed its return claiming deduction u/s.80IB(10) amounting to Rs.6,70,53,561/- in respect of project called “Crystal Heights”, which was accepted, as such, in the assessment completed u/s.143(3). Subsequently, the assessment was re-opened on the ground that the deduction was not permissible. The AO completed the assessment by withdrawing the amount of deduction at Rs.6.70 crore. The ld. CIT(A), relying on certain precedents, directed to grant proportionate deduction in respect of the profits derived from the sale of eligible units. Aggrieved thereby, the Revenue has come up in appeal before the Tribunal.

We have heard both the sides and perused the relevant material on record. The only point is about the granting of deduction u/s.80IB(10) of the Act which was denied by the AO on the ground of incomplete construction of the project. On the contrary, the ld. CIT(A) directed to allow deduction on proportionate basis in respect of the units fulfilling the requisite conditions prescribed under the section. In our considered opinion, this issue is no more res integra in view of several judgements of Hon’ble jurisdictional High Court, including Devashri Nirman LLB Vs. ACIT and another (2020) 429 ITR 597 (Bom) holding that the entire deduction cannot be disallowed u/s.80IB(10) of the Act and the same may be proportionately allowed in respect of the eligible units. Since the ld. CIT(A) has granted the deduction in the light of such a view, we echo the same.

In the result, the appeal is dismissed. Order pronounced in the Open Court on 02nd December, 2021